Google tries to reassure investors on AI progress as ChatGPT breathes down its neck

Google worked to reassure investors and analysts on Thursday during its quarterly earnings call that it’s still a leader in developing AI. The company’s Q4 2022 results were highly anticipated as investors and the tech industry awaited Google’s response to the popularity of OpenAI’s ChatGPT, which has the potential to threaten its core business.

During the call, Google CEO Sundar Pichai talked about the company’s plans to make AI-based large language models (LLMs) like LaMDA available in the coming weeks and months. Pichai said users will soon be able to use large language models as a companion to search. An LLM, like ChatGPT, is a deep learning algorithm that can recognize, summarize and generate text and other content based on knowledge from enormous amounts of text data. Pichai said the models that users will soon be able to use are particularly good for composing, constructing and summarizing.

“Now that we can integrate more direct LLM-type experiences in Search, I think it will help us expand and serve new types of use cases, generative use cases,” Pichai said. “And so, I think I see this as a chance to rethink and reimagine and drive Search to solve more use cases for our users as well. It’s early days, but you will see us be bold, put things out, get feedback and iterate and make things better.”

Pichai’s comments about the possible ChatGPT rival come as a report revealed this week that Microsoft is working to incorporate a faster version of ChatGPT, known as GPT-4 into Bing, in a move that would make its search engine, which today has only a sliver of search market share, more competitive with Google. The popularity of ChatGPT has seen Google reportedly turning to co-founders Larry Page and Sergey Brin for help in combating the potential threat. The New York Times recently reported that Page and Brin had several meetings with executives to strategize about the company’s AI plans.

During the call, Pichai warned investors and analysts that the technology will need to scale slowly and that he sees large language usage as still being in its “early days.” He also said that the company is developing AI with a deep sense of responsibility and that it’s going to be careful when launching AI-based products, as the company plans to initially launch beta features and then slowly scale up from there.

He went on to note that Google will provide new tools and APIs for developers, creators and partners to empower them to build their own applications and discover new possibilities with AI.

In addition, Google announced that starting in the first quarter of 2023, the company is going to change its reporting structure for its DeepMind AI segment. The segment will now be reported as part of Alphabet’s corporate costs, as opposed to being reported in the Other Bets umbrella, which includes long-payoff projects. Alphabet CFO Ruth Porat said the reporting change “reflects the strategic focus in DeepMind to support each one of our segments.”

The move is also meant to signal to the industry that the company is serious about investing in the advancing space of AI.

Shortly after the call, the tech giant revealed that it is holding a Search and AI event on February 8. The aim of the event is to show how Google is “using the power of AI to reimagine how people search for, explore and interact with information, making it more natural and intuitive than ever before to find what you need,” according to an invite sent to reporters. The invitation also includes hints about Google Maps, Lens, Shopping and Translate.

Google typically shares updates about Maps, Lens and other similar products during its I/O conference in May, which makes this new surprise event interesting. Since it’s taking place in a few days, it appears that Google is focused on addressing threats to its core business and reassuring investors it’s still an “AI-first” company.

“AI is the most profound technology we are working on today,” Pichai said during the call. “Our talented researchers, infrastructure, and technology make us extremely well-positioned as AI reaches an inflection point. More than six years ago, I first spoke about Google being an AI-first company. Since then, we have been a leader in developing AI. We are just at the beginning of our AI journey and the best is yet to come,” he said.

Another new development showcasing Google’s focus on AI is the news that it’s investing $300 million in AI start-up Anthropic. The news was first reported by the Financial Times and Google confirmed the investment to TechCrunch on Friday. Anthropic’s recently debuted AI model Claude is seen as a rival to ChatGPT. The new funding will value the San Francisco-based company at around $5 billion. The news comes as Microsoft recently announced a multi-billion investment in OpenAI.

Throughout the call, Pichai reiterated that Google has been investing in AI for several years now.

Although this is true, the company hasn’t exactly made many notable strides in the space publicly. For instance, the company has the AI Playground application, which had the potential to be like ChatGPT, but was purposely limited. The company also unveiled an AI language model called PaLM, which stands for Pathways Language Model, at I/O last year. It’s the company’s largest model to date, but Google has yet to share its plans for the model or how it will be leveraged.

Despite Google’s assurances, investors are now watching closely to see how the search giant responds to the looming threat posed by ChatGPT. Although shares of Alphabet opened lower today after the company turned in a disappointing fourth-quarter earnings report, the company recouped all of its losses by mid-day.

Google tries to reassure investors on AI progress as ChatGPT breathes down its neck by Aisha Malik originally published on TechCrunch